Just sold stock, made -$900 :(

[bonk102]

Originally posted by: dtyn
Can I ask why you sold at a time when the market is dropping 100 points a day? You would expect people to ride it out seeing as how the market eventually has to go back up. I'm no stock market guru, but following all trends, that's what has to happen.

i agree, i wish i had money to invest right now

 

[goog]

Now may not be the time to sell, in fact I added $1800 to my portfolio between mid April and early June. In hindsight it's obvious I jumped in too soon (or too late depending), since June was a bloodbath for the markets overall, I lost (on paper) maybe 6% altogether in June, and am minus a couple percent year ended June 30. Most of that money went into adding balance to better diversify and get into some better sectors in the process. I'm about 65% in aggresive growth and 35% in growth by category, but in reality the vast majority is blend or value stocks.
A 30% gain is a usually a good time to take profits and invest them elsewhere.

 

[LoverBoyJ]

Originally posted by: FeathersMcGraw

Originally posted by: Techie333
Well, I started an experimental account with $1000 and just sold my 3 stocks for about $150 plus all the fees makes it about $120.........yup yup yup..........i lost about $900........the funny thing is the first month i made like $300 (Sept. 00) and I was so greedy.......I didn't realize that a 30% GAIN IS HUGE!!!!...........sucks..........

Hope you kept records of both your initial purchases and your sale. That way, if you itemize your income taxes, you can deduct the difference as a capital loss.

Thats what I always do when I get a "loosing" stock that I want to get rid off. Use it to offset my gains that way I don't have to pay a hefty tax at the end of the year.

 

[Techie333]

Originally posted by: LoverBoyJ

Originally posted by: FeathersMcGraw

Originally posted by: Techie333
Well, I started an experimental account with $1000 and just sold my 3 stocks for about $150 plus all the fees makes it about $120.........yup yup yup..........i lost about $900........the funny thing is the first month i made like $300 (Sept. 00) and I was so greedy.......I didn't realize that a 30% GAIN IS HUGE!!!!...........sucks..........

Hope you kept records of both your initial purchases and your sale. That way, if you itemize your income taxes, you can deduct the difference as a capital loss.

Thats what I always do when I get a "loosing" stock that I want to get rid off. Use it to offset my gains that way I don't have to pay a hefty tax at the end of the year.

You'll have to excuse me, but I am really young, and don't much about itemizing my income???!! How exactly do you do this....I have kept all the confirmations that I got when I bought and sold the stock? Does this mean my taxes will be reduced by $900???!!!!

 

[rh71]

I get company stock at a discount... and I'll be needing the profit gained for a house real soon... but at this rate... I'm not making much profit, even after the discount. :|

 

[Miramonti]

Originally posted by: Techie333

Originally posted by: LoverBoyJ

Originally posted by: FeathersMcGraw

Originally posted by: Techie333 Well, I started an experimental account with $1000 and just sold my 3 stocks for about $150 plus all the fees makes it about $120.........yup yup yup..........i lost about $900........the funny thing is the first month i made like $300 (Sept. 00) and I was so greedy.......I didn't realize that a 30% GAIN IS HUGE!!!!...........sucks..........

Hope you kept records of both your initial purchases and your sale. That way, if you itemize your income taxes, you can deduct the difference as a capital loss.

Thats what I always do when I get a "loosing" stock that I want to get rid off. Use it to offset my gains that way I don't have to pay a hefty tax at the end of the year.

You'll have to excuse me, but I am really young, and don't much about itemizing my income???!! How exactly do you do this....I have kept all the confirmations that I got when I bought and sold the stock? Does this mean my taxes will be reduced by $900???!!!!

To make a short story long....

It means if you itemize your taxes with the 1040 long form instead of the ez form, you can write off up to 5k in losses per year and carry over any losses over 5k into the next years return.

Your $900 loss can go on a Schedule D (I think) as a loss, and when you fill out your 1040, the line item that refers to a schedule D will be -$900.

This will reduce your "taxable income" by $900, so if you are at a 25% tax rate for example, you will save $225 in taxes due. Its not alot but gives you back 1/4 of your losses. 🙂

 

[Miramonti]

Originally posted by: Beau6183

Originally posted by: FelixDeKat Sell. Sell now. Sell hard. Sell fast. Sell it all. Sell stuff you dont have. Just get out. Now.

Wow. I'm glad that there aren't a lot more people out there like you.

It seems like there have been quite a few around lately.😕

 

[FelixDeCat]

Originally posted by: jjsole

To make a short story long....

It means if you itemize your taxes with the 1040 long form instead of the ez form, you can write off up to 5k in losses per year and carry over any losses over 5k into the next years return.

Your $900 loss can go on a Schedule D (I think) as a loss, and when you fill out your 1040, the line item that refers to a schedule D will be -$900.

This will reduce your "taxable income" by $900, so if you are at a 25% tax rate for example, you will save $225 in taxes due. Its not alot but gives you back 1/4 of your losses. 🙂

Actually the limit is $3,000. Take it from a long time stock market loser who has about 15 years worth of write-offs left. Or take it from the man himself.

 

[Techie333]

wow, thanx for the info guys, thats great............at least I will be able to gain about 1/4 of my money.🙂😉

 

[CPA]

Alright, time to clarify a few things that have been said in this thread:

1) A loss on the sale of stock does not reduce your taxes dollar for dollar. It reduces your taxable income. Therefore, if you have an effective tax rate of 20%, then your tax bill will be reduced by $180 (900 x .20).

2) A gain or loss on a sale of stock is not an itemizable deduction. It is a capital gain or loss to income. Two different things. You do not have to itemize to take a stock loss.

3) Sometimes it is prudent to take a loss on stock. Think of it this way: You have $1,000 in stock at the beginning of the year, by the July you have $100 or a 90% loss. Now, what percentage gain would you need to get back to $1,000 by the end of the year (or two or three years for that matter)? 900%, that's right 900% which is not likely. Yes, it could come back sometime in the future, but if your tax bill is higher than you expect this year, why not help it a little. This example is simplistic, and basically comes down to your philosophy and feelings of the comeback nature for that stock. (Anyone thing Enron is coming back to $45 levels?)

4) "How would you make money when your loosing by selling low??" It's called shorting a stock.

5) As Felixdecat said, the limit on capital losses is 3K a year, but any overage can be carried over for 15 years, so to be used against future gains.

 

[911paramedic]

4) "How would you make money when your loosing by selling low??" It's called shorting a stock.

True, but you cannot do that unless the stock is on an uptick.

I wish somebody read my earlier quote in this thread. If you are down to $100 in value, your only downside to holding onto the stock is $100. Why not hold onto it because it has a chance of going higher in the future (of course you could lose it all, but only $100)

If you cashed out you could go out to dinner a couple times if lucky. Hang onto it now, too late to get out.

 

[Miramonti]

Originally posted by: FelixDeKat

Originally posted by: jjsole To make a short story long.... It means if you itemize your taxes with the 1040 long form instead of the ez form, you can write off up to 5k in losses per year and carry over any losses over 5k into the next years return. Your $900 loss can go on a Schedule D (I think) as a loss, and when you fill out your 1040, the line item that refers to a schedule D will be -$900. This will reduce your "taxable income" by $900, so if you are at a 25% tax rate for example, you will save $225 in taxes due. Its not alot but gives you back 1/4 of your losses. 🙂

Actually the limit is $3,000. Take it from a long time stock market loser who has about 15 years worth of write-offs left. Or take it from the man himself.

I knew it was 3k 10 years ago but thought they bumped it to 5k recently, those cheezy batards.

 

[Miramonti]

Originally posted by: 911paramedic

4) "How would you make money when your loosing by selling low??" It's called shorting a stock.

True, but you cannot do that unless the stock is on an uptick. I wish somebody read my earlier quote in this thread. If you are down to $100 in value, your only downside to holding onto the stock is $100. Why not hold onto it because it has a chance of going higher in the future (of course you could lose it all, but only $100) If you cashed out you could go out to dinner a couple times if lucky. Hang onto it now, too late to get out.

Thats what I told my neighbor when Worldcom was down to $1.50. 😛

This is rare tho and you're generally right. 😉